Both Apple and Qualcomm has reportedly tried to secure some exclusive access to Taiwan Semiconductor Manufacturing Co. smartphone ships by making a few investment offers into the custom chip maker that goes to the excess of $1 billion (Uh oh, is Apple trying to break off its deal with Samsung for their chips?). The cash would have assured the investors that production would have been reserved for their products, but both bids from Apple and Qualcomm were rejected, people that were familiar with this told Bloomberg. Apple and Qualcomm were apparently trying to secure manufacturing resources to somehow satisfy the increasing demand for smartphones a market Bloomberg Industries estimates to be worth almost $219 billion. I’m kind of curious as to know what “demand” their is for iPhone’s after there have been many reports that people have chosen Android over the iPhone. If anything, there is high demand for the Galaxy S III or Galaxy Nexus. Then again, I’m not expert analyst, so I’ll leave that work to them.
SMC, which happens to supply various chips to Qualcomm, Broadcom, Nvidia and various other companies, is willing to devote a entire factory or two to a single customer but is wanting to remain flexible enough so that they can switch production among customers and products, Bloomberg has said. However, SMC says that it is not in need of any sort of investment capital and is very unwilling to sell part of itself (and rightly so. If they aren’t in need of investment capital, why sell yourself?).
This arrangement would help Apple reduce the dependence it has on its foe, Samsung for mobile device components drastically. Despite some rumors that came out early last year that said Apple was courting Taiwan Semiconductor Manufacturing Co. to produce the A6 processor that was expected to power the next generation of both iPad’s and iPhones, some manufacturing issues have kept the chip production contract with Apple. This new switch almost makes me wonder if Apple had been preparing this lawsuit with Samsung since early last year if they were wanting to switch manufacturing companies. Honestly, it’d be no surprise if they were, but it’s interesting how long they might have been preparing the lawsuit against Samsung. I could be completely wrong, but it does seem to lineup with this contract Apple wants to secure with TSMC. I”m actually kind of curious as to how this move will be affecting Samsung after losing $1.5 billion, then $12 billion in shares and a ton of revenue coming from those chips they sell Apple. Things aren’t looking very good on Samsung’s end of things.
We’ll make sure to keep you updated for when Apple officially decides to switch with TSMC. There’s no doubt it’ll happen, the fact that they are willing to dedicate two factories to a single customer has to appeal to Apple a lot. It’ll definitely meet their needs if the iPhone 5 decides to go big. If it doesn’t well, that may just be a waste of money unless their iPad mini also goes big.